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JSE slips as oil pushes towards $80 a barrel

People walk near the reception at the Johannesburg Stock Exchange (JSE) in Sandton, Johannesburg. Picture: SIPHIWE SIBEKO/REUTERS

The JSE weakened on Tuesday, as interest-rate sensitive stocks came under pressure from a rising oil price, while downbeat local news added to investor woes.

The price of Brent crude reached an intraday high of $79.49 a barrel on Tuesday before paring gains. This followed data showing tight US inventories and Norweigian supply concerns. This weighed on banks and retailers, recently under pressure from a weaker rand, as it increases the prospects of an interest-rate increase.

The all share fell 0.33% to 58,027.1 points and the top 40 dropped 0.38%. General retailers lost 1.76% and banks 1.2%. Resources firmed 0.15%.

The local currency was stable, holding below R13.40 to the dollar shortly before the JSE closed, as global markets continued to brush off continued trade-war concerns.

Local data was downbeat, with the South African Chamber of Commerce and Industry business confidence index disappointing, coming in at 93.7 points in June from 94 points the previous month. This has served to reinforce a series of economic releases showing that South African economic growth is not accelerating as quickly as was previously hoped.

Wage negotiations at Eskom, where unions are demanding an 8.5% wage increase, also continued on Tuesday.